As Theresa May brings together her cabinet to discuss the key issues Brexit poses, Airbus CEO Tom Enders has been critical of the UK and May’s handling of proceedings. Enders highlighted the recent success of the English soccer team at the FIFA World Cup and the centenary celebrations that await the RAF but was adamant that May and her cabinet are still failing to create an adequate strategy to maneuver a successful Brexit deal for the UK. Reports have stated that the cabinet meeting will be the last chance May will get to formulate an appropriate solution to the issues the UK will face post-Brexit.
The criticism comes as a major concern to the UK government as Airbus, although headquartered in Toulouse, operates many of its large-scale engineering manufacturing in the UK. A poor Brexit deal has the potential for Airbus to move its engineering facilities to a more stable economy in Europe, Germany for example. Enders warned that without an adequate deal on trading arrangements, the future of Airbus in the UK may be in doubt.
Airbus has not been alone in their criticism with many other large manufacturers venting their frustrations at the lack of progress in this Brexit deal. Jaguar Land Rover claims that a hard Brexit will cost the company £1.2 billion in annual profit and £7.5 billion to the UK car industry as a whole. One of the reasons behind this substantial figure is the leather chemicals and dyes that Jaguar Land Rover use on their seats. These products are sourced in Germany and Italy and then imported to Scotland. From Scotland, they are sent to Poland to be cut and sewn and manufactured onto the seat. Finally, the seats are sent back to the UK and ready to be placed inside their cars. This movement of good across various different borders will, of course, incur large costs. If Theresa May fails to secure a positive deal the UK and its companies may face large tariffs creating a barrier to successful commerce.
Currently, Airbus employs 15,000 people in the UK. CEO Enders has urged for May and her cabinet to fight for a successful deal that will ensure UK businesses can continue to grow and expand while operating in their economy. As the UK prepares to leave the EU in just over nine months it is paramount that all talks continue to be successful and beneficial as the end date nears. It has been reported that some of Mays senior cabinet members have been campaigning in favour of a total removal away from the EU.
However, it is believed this will result in high tariffs and costs that businesses will incur when looking to trade internationally.
It is clear the potential ramifications of a hard Brexit on UK businesses could prove to be devastating. With many of the world’s largest manufacturers having operations in the UK, a successful deal is crucial for the health of the British economy. Warnings from Enders of Airbus and Jaguar Land Rover have been echoed around the business world. It is now up to May and her cabinet to deliver, ensuring the future British economy remains competitive in the global business sphere.
